Can the “Affordable Version Model Y” replicate the blockbuster success of the Model YL? If it is indeed launched, what are its chances of winning against a host of domestic new energy vehicle startups in China?
The long-rumored “affordable version of Tesla,” which has lingered in leaks for years, seems to be inching closer to consumers.
Recently, the account @tesla_modelY reported that Tesla’s latest software update includes detailed configuration information about the “budget Model Y” (codenamed “E41”).
Compared with the current Model Y, this new E41-codenamed vehicle omits numerous features. For instance, it does away with the panoramic glass roof, rear-seat display, power-folding side mirrors, welcome projection lights, “Airwave” air air outlet design, and heated reverse camera. Additionally, reports indicate that its audio system, suspension, wheel rims, interior materials, and seat functions are all simplified compared to the existing Model Y—some versions even remove the tire pressure monitoring system.
Upon seeing this, netizens reacted strongly: one group exclaimed, “There’s no such thing as ‘too basic’—only ‘even more stripped-down’,” while another argued, “As long as the price is right, nothing else matters.”
Many may be skeptical of the “budget Model Y,” viewing it as a mere cost-cutting measure to lower the price tag and expand market reach.
The sub-200,000-yuan segment is already “flooded with strong competitors,” making this strategy seem far from “cost-effective.”
However, Tesla’s track record of creating bestsellers cannot be underestimated. The Model YL, launched in August, has drawn criticism for its uncomfortable rear seats, cramped third row, and lack of “luxury extras like fridges or large screens.”
Yet, its production slots for October 2025 were already sold out, with delivery dates pushed to November.
This reflects a common trend for Tesla in China: “complaining while buying,” underscoring the brand’s influence and market recognition.
Whether the “budget Model Y” can replicate the Model YL’s blockbuster success remains to be seen.
Stripping Down to the Essentials
Rumors about a “budget Tesla” have circulated online for years.
In 2020, Elon Musk first mentioned a $25,000 affordable model during Tesla’s Battery Day. Planned to be built on a next-generation platform, it aimed to slash costs significantly, featuring a “rare-earth-free” motor, a 100% self-developed controller, and a 48V low-voltage electrical system, with a target annual sales volume of 5 million units.
This affordable model was also supposed to support FSD (Full Self-Driving) technology.
However, Musk’s “affordable model” project hit a snag and was abruptly canceled during a conference call.
Later, he proposed reducing the price of the Model Y by cutting features, aiming to lower production costs by 20%.
Recent leaks suggest that the so-called “budget Tesla” is essentially a stripped-down version of the Model Y. According to Tesla Archive, the vehicle may be equipped with a 52kWh battery pack, fabric seats, a metal roof, and even smaller wheel rims.
Combined with the detailed information from the latest software update, it is clear that Tesla’s “drastic” feature cuts will bring the entry threshold of its electric vehicles below 200,000 yuan.
While the Chinese market’s mainstream trend leans toward “fully equipped” vehicles, Tesla is going against the grain by using a “cut-features-to-lower-price” strategy to penetrate the mid-to-low-end market. On the positive side, this provides consumers with budgets under 200,000 yuan with a new option.
Yet, in terms of product strength, Chinese auto brands already offer a plethora of choices in the sub-200,000-yuan segment.
Pure electric SUVs include models like the Geely Galaxy E5, Leapmotor C11 EV, and Fang Cheng Bao Tai 3; pure electric sedans range from the Xpeng MONA M03 and Leapmotor C01 EV to the Nissan N7. In short, options are “diverse and abundant.”
It is fair to say that if the Model Y enters the sub-200,000-yuan market, its “spec sheet appeal” will not be high.
Nevertheless, it is foreseeable that as long as the price is low enough, many consumers will still accept it. For long-time Tesla owners, the phrase “Made by Tesla” may matter more than the actual features.
What Do Tesla Fans in Guangdong Think?
Mr. Qiu, the owner of a 2024 refreshed Model 3, has a unique take on the “budget Model Y.” As a die-hard Tesla fan from Guangdong, he reserved high praise for the metal roof, calling it a “game-changing upgrade” for Tesla.
“In the past, when we Guangdong people bought cars, having a sunroof was just for showing off. Deep down, everyone knows that given our local weather, we barely get to open the sunroof—you can count the number of times on one hand. Replacing the Model Y’s glass roof with a metal one? I’d even pay extra for that, let alone getting it at a lower price,” he said.
Many Tesla owners in southern China likely resonate with Mr. Qiu. For most of the year, daytime temperatures in Guangdong exceed 30°C.
Mr. Qiu uses his Model 3 for daily commuting and parks in an open-air lot at work. After just an hour in the sun, the car’s interior turns into a “sauna room.”
Mr. Qiu added that friends who have ridden in the backseat often complain about “feeling too hot on the head.”
To mitigate this, he even bought a sunshade, though it only provides minimal relief. He finds the viral online images of people holding umbrellas inside cars “understandable,” even though he would not do it himself.
“The sun shines directly into the car, and the panoramic glass roof barely blocks it. Even with a sunshade, it only gets a little better—I have to crank up the AC to stay comfortable,” he explained.
Mr. Qiu is well aware of the countless more feature-rich options under 200,000 yuan. But as a Tesla fan, he places greater trust in Tesla’s status as an industry benchmark and the reliability of its three-electric (battery, motor, ECU) system and energy management technology.
He also believes that Guangdong consumers prioritize a “durable, trouble-free car” over one with “more features.”
This is true even though most pure electric SUVs under 200,000 yuan “have everything you need”—many even come with a “panoramic sunroof” and an “electric sunshade.”
To netizens, the “budget Model Y” seems to have no advantages other than the Tesla brand.
However, the Model YL’s popularity may indicate that the “silent majority” who actually spend money value the consumer confidence brought by brand reputation, word-of-mouth, and after-sales service more.
In other words, if the price meets expectations, the rumored “budget Model Y” could still deliver impressive market performance.
As Mr. Qiu put it: “I know Chinese brands offer unbeatable product strength, but a car is a big-ticket item. Ordinary people can’t just replace it whenever they want. Instead of buying something ‘flashy,’ everyone prefers something ‘reliable.’ That’s probably why Tesla still ‘holds its ground’ in the new energy vehicle market today.”
So, what price do you think this “Model Y SE” should be? If it really hits the market, how likely is it to outcompete domestic new energy vehicles?
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